Markets regulator Sebi on Tuesday proposed to allow direct listing of Indian companies on overseas bourses and of foreign firms on Indian exchanges, while setting up an expert panel to look into the details.

The panel will also make recommendations for a suitable framework in which to facilitate such direct listing. (Reuters)

Markets regulator Sebi on Tuesday proposed to allow direct listing of Indian companies on overseas bourses and of foreign firms on Indian exchanges, while setting up an expert panel to look into the details. Currently, Indian companies can list their shares through depository receipts abroad, while foreign companies need to go through the Indian Depository Receipt route for listing of equities.

However, Indian firms can list their debt securities directly on international exchanges as what is known as ‘Masala Bonds’. “Considering the evolution and internationalisation of the capital markets, it would be worthwhile to consider facilitating companies incorporated in India to directly list their equity share capital abroad and vice versa,” the Securities and Exchange Board of India (Sebi) said in a release.

“In this regard, it has been decided to constitute an expert committee to look into this aspect in detail,” it added.
The committee will examine in detail the economic case for permitting direct listing of Indian companies overseas and vice versa.

Besides, it would examine various legal, operational and regulatory constraints in facilitating companies incorporated in India to directly list their equity share capital abroad and vice versa, Sebi said. The panel will also make recommendations for a suitable framework in which to facilitate such direct listing.